In a significant turn of events in the cryptocurrency landscape, the bankrupt exchange FTX has announced plans to commence its next round of cash distributions to creditors on or around September 30, 2025. This news comes as a beacon of hope for those who have been waiting to reclaim their funds after FTX’s spectacular collapse in late 2022.
For creditors eagerly anticipating payouts, it’s crucial to note that the record date for eligible claimants is set for August 15, 2025. This timeline establishes who qualifies to receive funds in the upcoming distribution.
The upcoming financial relief will extend to holders of approved claims in various categories, including Class 5 Customer Entitlement Claims, Class 6 General Unsecured Claims, and Convenience Claims. These categories represent a diverse group of creditors who have been validated since the last round of payouts, as outlined in a recent statement from FTX.
What adds to the excitement is the recent court approval allowing FTX to slash its reserve for disputed claims by an astonishing $1.9 billion, reducing it from $6.5 billion to $4.3 billion. This reduction not only highlights the progressive steps being taken in the bankruptcy proceedings but also liberates additional resources for creditor distributions, an essential move that paves the way for a more efficient payout process.
As FTX endeavors to resume payouts, it’s important for claimants to be aware of the requirements necessary to receive payments. To qualify, creditors must undergo Know Your Customer (KYC) verification, submit the requisite tax forms, and register with one of FTX’s distribution partners, namely BitGo, Kraken, or Payoneer. Timeliness is crucial here; for those wishing to transfer claims, it’s imperative that the transfer is fully processed and recorded by the August 15 record date.
Looking back, the initiation of creditor repayments earlier this year marked a turning point in FTX’s restructuring saga following the court’s nod for its redistribution plan. Thus far, approximately $6.2 billion has been successfully returned to creditors, showcasing the progress made despite the turbulent backdrop of FTX’s downfall.
For those who might not be familiar with the full context, FTX was once a titan in the cryptocurrency domain before its spectacular fall in November 2022, caused by a liquidity crisis spurred by alarming revelations regarding its financial practices. This turmoil culminated in criminal charges against its founder, Sam Bankman-Fried, who was sentenced to 25 years in prison for defrauding customers and investors out of over $11 billion. Interestingly, due to good behavior, he is projected to be released earlier than expected, on December 14, 2044.
In the midst of these developments, challenges are still surfacing. A Chinese creditor representing over 300 users has publicly opposed FTX’s proposal to restrict payouts in 49 jurisdictions, including China. This creditor, Weiwei Ji, argues that restricting payouts is both legally unfounded and an unfair burden on users, especially those from jurisdictions with potential legal recourse through Hong Kong.
Restricted jurisdictions FTX received 70 objections from creditors Suggests include following Voyager/Celsius procedures to make payment to Restricted Jurisdictions pic.twitter.com/0w960OC2EA— Sunil (FTX Creditor Champion) (@sunil_trades) July 22, 2025
Claims from these jurisdictions are substantial, totaling around $800 million, with a staggering 82% attributed to Chinese creditors. The unfolding negotiations represent a critical juncture not only for FTX but also for the future regulations surrounding cryptocurrency exchanges.
As we look ahead, the outcomes of these disputes and distributions could set precedents for handling bankruptcies within the crypto industry, an area still navigating uncharted waters. With each development, stakeholders remain on high alert, understanding that there’s much at stake not just for FTX but for the broader crypto ecosystem as well.
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